What Is a Section 1115 Waiver? How Medicaid Demonstrations Change NEMT

Every state must make sure Medicaid members can get to their medical care. That promise is the assurance of transportation, in 42 CFR 431.53. A section 1115 waiver is one of the few ways a state can change it, and a few states have used one to leave some members without NEMT.

What a section 1115 waiver is

Section 1115 of the Social Security Act lets the Secretary of Health and Human Services approve an experimental, pilot, or demonstration project that is likely to help promote Medicaid’s objectives. CMS calls them demonstrations, and most people call them waivers. Each approval can include two kinds of authority:

• Waiver authority. The state may set aside specific requirements of section 1902, the part of the law that lists what every state plan must do.
• Expenditure authority. Federal funds may match costs Medicaid would not normally pay for.

CMS reviews each request case by case. Medicaid.gov says demonstrations are generally approved for five years at first and can be extended for up to three to five more years, depending on the people served. They must also be budget neutral, meaning federal spending with the demonstration should not exceed spending without it. Public Law 119-21, signed July 4, 2025, wrote that into law as section 1115(g). Starting January 1, 2027, CMS may approve a new demonstration, renewal, or amendment only if its Chief Actuary certifies it is not expected to raise federal Medicaid spending.

States use several tools to shape rides. The 1115 is the broadest.

Tool	What it can do to rides	How long it lasts
State plan brokerage option, section 1902(a)(70)	Run NEMT through a broker without statewideness, comparability, or free choice of provider	Part of the state plan
Section 1915(b) waiver	Put rides into managed care or limit which providers members use	2 years, or up to 5 with dual eligible members
Section 1915(c) waiver	Add non-medical rides for people in a home and community waiver	3 years, then 5-year renewals
Section 1115 demonstration	Waive the NEMT requirement for a group, change how rides are delivered, or add benefits	Usually 5 years, then up to 3 to 5 years per extension

The first two rows come from CMS’s Medicaid Transportation Coverage Guide (SMD 23-006, September 28, 2023). For how states combine these tools, see how states run NEMT.

How an 1115 can change NEMT

These are real approvals on Medicaid.gov, as of September 2026.

State and demonstration	What it does to rides	Dates
Iowa Wellness Plan	Relieves the state of assuring rides for adults in the expansion group. Medically frail members and members eligible for EPSDT keep NEMT.	NEMT waiver ends December 31, 2026
Georgia Pathways to Coverage	Members get no NEMT, except those 19 and 20 years old, who receive EPSDT services	Temporarily extended through December 31, 2026. Georgia’s extension request, filed April 28, 2025, is pending.
Tennessee TennCare III	Adds community transportation for CHOICES members: non-medical rides to jobs, stores, worship, and community activities in their support plan, on top of medical rides	Amendment approved May 17, 2024. Demonstration runs through December 31, 2030.
Hawaii QUEST Integration	Pays for non-medical rides for members in its 1115 home and community services, arranged by the health plans	Billing memo QI-2611, May 8, 2026

Why Iowa’s NEMT waiver is ending

In its November 28, 2025 approval letter, CMS said extending Iowa’s NEMT waiver past December 31, 2026 would not be likely to promote Medicaid’s objectives. It pointed to research showing rides improve access to care, to Iowa survey data linking unmet ride needs to missed care, and to the Consolidated Appropriations Act, 2021, which wrote the NEMT requirement into section 1902(a)(4). The waiver will not continue even if the rest of the demonstration is extended.

Iowa HHS posted a proposed state plan amendment, SPA IA-26-0010, on September 17, 2026 to add NEMT for the whole Iowa Health and Wellness Plan population. It estimates the annual cost at $129,367 in total funds for state fiscal year 2027, and comments are due by 4:30 p.m. on October 17, 2026. It stays a proposal until CMS approves it. See the Iowa state guide.

A billing example: Hawaii

When an 1115 adds non-medical rides, the plan may need to tell them apart from NEMT. Hawaii’s memo QI-2611 (May 8, 2026) has providers bill these trips with codes NEMT also uses: A0100 as the base code, S0215 for each mile, and A0120 or A0130 added when the member needs what the memo lists as a stretcher van or a wheelchair van. Each code carries modifier U7 for a trip to a destination in the member’s care plan or U8 for a trip from it. The memo does not apply to rides already included in another service’s rate, such as adult day health. Members living in residential care or a community care foster family home are not eligible for these rides.

How to read your state’s 1115 approval

1. Open the State Waivers List on Medicaid.gov. Filter by your state and the 1115 authority.
2. Open each demonstration. Note its status (approved, pending, or expired) and its expiration date.
3. Download the newest approval letter. The first pages summarize what changed and when.
4. Find the list of waiver authorities. Each item names a section of the Social Security Act and says how far it is set aside. A NEMT waiver appears under methods of administration, citing section 1902(a)(4) and 42 CFR 431.53. Iowa’s reads “to the extent necessary to relieve the state of the responsibility to assure transportation.”
5. Read the benefits section of the special terms and conditions. Georgia’s says members receive state plan benefits “with the exception of non-emergency medical transportation.”
6. Check the expenditure authorities for added services, such as home and community rides.
7. Watch for pending requests. Before applying for a new demonstration or an extension, a state must give at least 30 days’ public notice and hold at least two public hearings (42 CFR 431.408). CMS then takes public comments for 30 days and makes no final decision for at least 45 days after it gives notice of a complete application (42 CFR 431.416). Anyone can comment, including your company.
8. Check your state plan. SMD 23-006 says the transportation pages of the state plan, Attachment 3.1-D, should point to any 1115 authority used for rides.

Then check each rider’s coverage for the date of the trip. The eligibility response shows the rider’s program, and a member in a group without NEMT will not get a ride authorized. See Medicaid eligibility verification. State guides for Georgia, Tennessee, and Hawaii cover each state’s ride programs.